Israeli Prime Minister Benjamin Netanyahu is moving to expand Israeli settlements in the West Bank at a time when international attention is focused elsewhere, with President Obama gearing up for reelection and the West targeting Iran's nuclear program.

Last week, the Netanyahu government took a variety of steps that, taken together, amount to a significant strengthening of Israel's hold in the West Bank, the biblically resonant territory occupied in 1967, which Palestinians claim as the heartland for their future state.

For Netanyahu, who heads a right-wing coalition with a strong pro-settler contingent, it was a delicate dance of one small step back and six larger steps forward for settlements.

So an economic report from the World Bank gives clear advice to Ramallah not to insist on the UN vote on statehood, in the face of the resistance from Washington: with continuing, sustainable advances in its economy, the West Bank is an excellent candidate to become a state. In the meantime, there are steps to be taken: donations, an easing of Israeli restrictions, and a Palestinian Authority focused on institution-building. And the negotiating table is the "best" way of achieving the sustainable economy as well as political settlement.

This time, Washington has to bring something more than Obama’s speech, with more flexibility for the European Union initiative, to the table. One possibility? Acknowledging Hamas behind closed doors, giving Abbas a guarantee that Ramallah will never need to recognise a “Jewish state”, and promising a Palestinian state with East Jerusalem as its capital in a year.

At the same time, a sign can be given to Prime Minister Netanyahu that he can be a peace-making hero ahead of Israeli elections. How? The release of Gilad Shalit, the detained Israel soldier, by Hamas.

And if this is not pursued? Well, get ready for the September display at the United Nations.

Israel should understand that its state policy of collective punishment has cracked, if not come to an end: Egypt’s announcement that it will permanently open the border crossing with Gaza and plans for a new Gaza flotilla in June are only the drops of a shower washing away West Jerusalem's approach.

If the terms of the Shalit deal are made public, with Hamas offers a relatively "better" deal --- which it will do to increase the international pressure on Israel --- the Gaza group will not only advance in the hearts and minds of millions of Arabs, and possibly some Israelis, as well as boosting its credibility in the eyes of Western capitals.

The rival Palestinian groups Fatah and Hamas have reportedly reached an agreement, brokered by Egypt, to end their rift and that between the West Bank and Gaza.

The two sides have been in a series of talks in the last few years, climaxing when Fatah signed a reconciliation deal in 2009. Hamas had reservations, however, over the arrangement for security forces in the Gaza Strip and the lack of a guarantee that its victory in elections would be recognised. Hamas demanded further gestures before considering unity, such as a release of hundreds of it prisoners locked up in the West Bank, the re-opening of Hamas charities, and the removal of a ban on its activities in the West Bank.

Oren starts with the premise of a a strong ally that not only “shares America’s values, reflects its founding spirit, and resonates with its people’s beliefs”, but also politically, militarily and economically enhances Washington’s position in the Middle East. According to Oren, in this “dynamic” relationship, far from one-dimensional, “America needs Israel now more than ever”.

So now it is said that the exchange of hostilities between factions in Gaza and the State of Israel will not bring another war. After the concern of recent days that West Jerusalem might repeat the attack of 2008/9, Operation Cast Lead, suddenly the talk from Hamas and then from Israel was of a cease-fire.

So what happened?

The surface reading had been that an escalation of tension on the Gaza border was useful for Israel’s Prime Minister Benjamin Netanyahu, as this took attention away from any need for concessions in talks on the other Palestinian front --- the West Bank --- ahead of Israeli elections. Indeed, even Washington's statement that it was“deeply concerned” about the construction of another 942 housing units of Israeli settlements in the West Bank could be put aside.

A review of the last two weeks, before Wednesday's explosion of a bomb near a bus in Jerusalem....

The construction of Israeli settlements in the West Bank has quadrupled since the end of the temporary freeze last autumn, say Israeli official documents.

Five members of the Fogel family are massacred in the settlement of Itamar. Although this act is condemned by the Palestinian Authority, Israeli government and media organisations consider it a terrorist attack. West Jerusalem’s responds quickly. The Ministerial committee on settlement affairs approves the construction of 500 new homes in several West Bank settlements. The Israel Defense Forces carry out mass arrests in the village of Awarta, and questioned almost all the men.

Speaking in Miami last week, President Obama addressed Israel’s security concerns within the context of the “new” Middle East. He said,“I'm actually confident that 10 years from now we're going to be able to look back and say that this was the dawning of an entirely new and better era.”

The statement came as Israeli Prime Minister Benjamin Netanyahu prepares to announce his “grand plan” in May, calling for the establishment of a Palestinian state with temporary borders as part of an interim peace agreement.

Netanyahu met resistance from his own Minister of Defense, Ehud Barak, who said that immediate immediate action was necessaryand sought clarity from the Prime Minister: ""A permanent agreement has a chance only if Israel would be willing to clearly say what would come after it....A permanent agreement has a chance only if Israel would be willing to clearly say what would come after it.”